Archive

April 19, 2024
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HEW: Reflating Tighter for Longer

  • This week, the absence of policy decisions was no barrier to further hawkish moves as UK price and wage inflation exceeded expectations, and FOMC comments reopened the possibility of another rate hike. We still believe the BoE should cut later than the Fed.
  • It’s another quiet week ahead for monetary policy announcements, with the BOJ and Bank Indonesia the main ones. The flash PMIs are our data highlight, notwithstanding the Q1 GDP, March PCE and durable goods data from the US.

By Philip Rush

April 12, 2024
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HEW: Different Evidential Hurdles

  • It’s been a packed week for policy news. Market moves were primarily driven by another surprisingly strong US inflation release, shifting expectations towards our September call. However, we pulled our modal ECB and BoE calls three months earlier.
  • Next week only has policy announcements from Chile after the recent flurry. Attention in the UK can move to the macro data where labour market, inflation and retail sales are released. The final EA HICP data will also print, with a slight risk of upward revision.

By Philip Rush

April 05, 2024
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HEW: Data Keeps Doves Locked up

  • During the past fortnight, data releases have continued their resilient trends, with output surveys and payrolls typically beating consensus expectations. These are inconsistent with policy being too tight, so rate cuts should remain locked up.
  • Next week is relatively quiet for data releases but features monetary policy decisions for the Euro area, Canada, New Zealand, Thailand, Philippines, South Korea and Peru. We expect the ECB to maintain data dependence rather than commit to a June cut.

By Philip Rush

March 22, 2024
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HEW: Doves Fly Into Holidays Again

  • Most releases over the past week may not have been that surprising, but the market read central bank decisions as worth letting dovish trades fly into another holiday season. Then Andrew Bailey forgot he sucks at guidance, and he crashed the currency.
  • The fortnight ahead is much quieter for releases, partly because of the Easter holidays. Highlights for us are flash HICP on the data front, while Chile and the Riksbank are it for policy. This publication will take its usual Easter break and return in a fortnight.

By Philip Rush

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